Quite often friends and clients ask me about the best pension plans and I can understand. Pensions are complicated, even more so since Pensions Freedoms came into play.Successive Governments have tinkered with the pension rules and regulations time and time again. I started in the Financial Services Industry in 1984 and I can say each year the government has made some sort of change. Sometimes for the better or worse, but usually it adds another layer of complication. Terms such as Lifetime allowance, Fixed Protection, Capped and Flexi Access Drawdown are technical terms that generally confuse the public.In its simplest form a pension is a savings contract with tax breaks written under pension rules.
I’ve been thinking about the answers I have given in the past and to try and provide a straight forward answer is not easy. A pension is not easily tangible as you cannot see it or touch it. There are several distinct types of arrangements available. A simple answer to the question - the best pension plans are the ones that enable you to have the lifestyle in retirement you desire for as long as you and your partner (if you have one) are still alive. There are however several issues you must consider.
It’s fair to say, if your contributions are small, don’t expect to get a great retirement income. The more you put in the more you should get out, especially if you are investing over a long period of time. For many people, the maximum annual amount you can contribute to a pension and get tax relief should be high enough. This is called the annual allowance and is currently is set at £40,000. Depending on your circumstances the maximum amount could be less if you are a high earner or have a lower level of income.
Many Financial Planners use software to help you develop your own financial plan. The plan could include how much you need to save into pensions between now and retirement as well as the annual rate of return you need to achieve on your pensions to ensure you have the retirement you would like.We call this service our lifestyle financial planning service. If you would like to find out more please contact us.
This article is in relation to UK defined contribution pension arrangements such as personal pensions, sipps or Money Purchase pensions.
Time and time again forecaster try to predict what will happen in the future to Stock Markets. In reality, nobody knows what Markets will do next.
The Wall Street Journal in the US recently
published an article about the performance of Global Stocks and Shares. The
article was called, “ Global
Stocks Post Strongest First Half in Years, Worrying Investors
for stocks and shares investors is whether the strong first six months of 2017 heralds
a choppier second half or the start of a multiyear upswing. The data on global
rallies offers a mixed record.”
In plain English, this means:
“It’s impossible to predict whether markets will go up or down for the latter half of the year. Markets could go up or down or even trade sideways.”
The newspaper article also reported that: “Most of the major stock Market Indexes, 26 in total have risen in value so far in 2017. The last time this happened was in 2009.
Over the month weeks and months, we are looking to improve the personal finance portal (PFP) for our clients. The first stage is to introduce a live chat, audio and video service whilst clients are logged into PFP. This is the first level of improvements we will be making over the coming months. The live chat service is safe and secure.